Scammers and money are a glued equation, and cryptocurrencies are the new black for scammers.
Bitcoin scams are increasing, according to federal government figures. They are becoming more common due to the ability to gain the victim’s trust.
Blockchain data firm Chainalysis identified $14 billion of stolen crypto last year.
What are the most common scams?
-Fake websites: Creating a fake website full of information and then disappearing is one of the easiest ways to scam people.
Fake websites are slightly different from the main domains, and they try to mimic them.
The presentation is similar to the legitimate ones, making it difficult to spot a difference.
They operate in two ways. Certain websites request your details, such as the crypto wallet’s password and recovery phrase or other financial information.
The other form of operation is that they make you believe you are investing in some random coin created by them, inflate the numbers, and then run away with your money.
-Fake crypto: Celebrities collaborate with cryptocurrency. In January, Kim Kardashian and Floyd Mayweather Jr. were sued in a class action legal process for inflating a coin, and then, the creators disappeared.
How to identify a crypto scam?
-Promise of guaranteed money: Bitcoin, Ethereum, SHIB, Doge, none of them is a solid investment.
By definition, cryptocurrencies are volatile, and returns are never secure.
-No whitepaper: All cryptocurrency has had a whitepaper since their creation. It is one of the most crucial aspects of an initial coin offer.
If the whitepaper doesn’t make sense or doesn’t exist, don’t do it.
-Marketing hyperbole: A hyperbole is an exaggeration. We spoke about Kardashian and Mayweather.
Excessive marketing is not a healthy sign. It is a strategy to reach as many people, and raise money at a fast pace.
Do your research.
-Unnamed team members and free money: Secrets are no good for investors. In every functional business, the names of the partners are always backed-up on paper.
Be cautious if the crypto or the site hides the names of the members or gives you money for free.
How to protect yourself from a scammer?
-Protect your wallet with private keys.
-Verify your wallet app and send only a small amount to confirm the legitimacy.
– Invest in things you understand.
-Don’t rush, scammers use high-pressure tactics to get your money.
-Download apps from official platforms.
-Do your research.